...Four-Notch IDR Downgrade Buffer: The covered bond rating is based on DBS Bank Ltd.'s (DBS) Long-Term Issuer Default Rating (IDR) of `AA-', an IDR uplift of zero notches, a payment continuity uplift (PCU) of six notches, a recovery uplift of one notch and the contractual asset percentage (AP) of 85.0% used in the programme's asset coverage test (ACT) that Fitch Ratings gives credit to in its analysis. The Stable Outlook reflects a four-notch buffer against a downgrade of the bank's IDR. Strong Liquidity Protection: Fitch's PCU of six notches reflects the programme's liquidity protection in the form of a soft bullet issuance with a 12-month principal extension period, as well as interest protection provisions in the form of a reserve that covers interest and senior expenses on a rolling three-month basis. Recovery Uplift Capped: The recovery uplift is capped at one notch as foreign-exchange risk is likely to have a material impact on recoveries given default of the covered bonds. The cover...
